Earnings Preview: Starwood Hotels & Resorts

Starwood Hotels & Resorts Worldwide Inc. reports results for the third quarter on Thursday. The following is a summary of key developments and analyst opinion related to the period.

OVERVIEW: Like others in the industry, Starwood Hotels & Resorts Worldwide Inc. has seen its revenue slump as both leisure and business travelers tighten their budgets and stick closer to home.

Through the first six months of the year, Starwood's revenue was nearly 24 percent lower than a year earlier.

The White Plains, N.Y.-based chain operates the Sheraton, W Hotels, Westin, St. Regis, Four Points, Aloft brands.

During the third quarter, Starwood agreed to sell the W San Francisco to an investment company for $90 million but will continue to manage the property under the W name.

Starwood also kicked off a campaign to highlight a $6 billion revitalization of its Sheraton brand by giving away free stays at 86 recently renovated locations in the U.S. and Canada.

The lodging company named Ted Jacobs as vice president of brand design late last month. Jacobs will oversee the design studio that deals with the interiors of its W Hotels, Le Meridien, St. Regis and The Luxury Collection.

BY THE NUMBERS: Analysts polled by Thomson Reuters predict a profit of $1.02 per share on revenue of $1.16 billion for the quarter. During the same period last year, Starwood earned $113 million, or 62 cents per share on revenue of $1.54 billion.

ANALYST TAKE: JPMorgan analyst Joseph Greff said Starwood has managed its expenses well and done a better-than-expected job at cutting its selling, general and administrative and property-level expenses.

The White Plains, N.Y.-based company also stands to benefit from its combination of hotel ownership and management with franchise operations. A mix of luxury properties in key markets like New York, Hawaii and Europe and reduced expenses provides Starwood with "the highest recovery in lodging in the future and certainly the easiest comparisons in 2010," Greff wrote in a research note last month.

WHAT'S AHEAD: Analysts will be looking for an update on how occupancy rates are faring and what executives have to say about when they could recover as the recession comes to an end.

STOCK PERFORMANCE: During the quarter, which began July 1, shares climbed nearly 49 percent to end the period at $33.03, near the high end of it's 52-week range from $8.99 to $36.45.